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Policy

22 April 2015Economy

Overview

With one of the worst economic recessions in living memory
resulting in banks collapsing, companies folding and soaring unemployment it's
not surprising the economy has been a central focus for parliament, government
and remains a key issue for voters.

In the last five years we've watched closely as the
Conservative-led government has navigated this challenging economic space.

Over the last five years, despite rocky periods, the economy
has picked up and is predicted to grow a respectable 2.8% this year. The
financial services industry has improved and the banking sector has been
recapitalised.

Since 2010 the Government has pursued a rigorous austerity
programme aimed at cutting the budget deficit and pulling the country out of
recession. The budget deficit is now half what it was in 2010 at 5% of GDP.
There is still a long way to go as the UK's debt still stands at over 80% of
GDP.

Christian perspective

As Adam Smith a Scottish
philosopher and pioneer of political economy recognised, the economy is a moral
reality. Human beings actualise their moral selves in making economic choices
and through participation in the economic system.

Christians should look at the
economy as a reflection of our values. The Bible values honest labour and
dedicated workers, and warns against dishonest business practices such as tax
dodging, dishonest accounting practices and insider information. The Bible
honours investment, thrift and responsibility when managing our finances.

We see time and again a call to
care for the poor and a responsibility to those beyond our borders. Our
economic perspective must be filtered through this biblical narrative of
honesty, hard work and care for others. The reality is that this is often a very
hard tension to operate in but one that must be pursued as we prayerfully and
carefully consider the economic policies on offer and the political ideologies
of the various parties.

Party policies

The Conservatives
will make a further £30 billion in cuts in order to see the UK return to
surplus by 2018. They have promised to increase the tax-free Personal Allowance
to £12,500, ensure people who work 30 hours per week on the minimum wage pay no
income tax and crack down on tax dodgers. They want to invest £1 billion in
infrastructure.

Labour have
promised not to increase spending and work to cut the deficit but have given no
deadline on this. They want to increase the minimum wage to £8, bring back the
50p top income tax rate, ban zero-hours contracts deemed to be "exploitative",
freeze energy bills until 2017 and introduce a British Investment Bank.

The Liberal Democrats
want to eradicate the structural deficit by 2017/18, increase public spending
once the budget is balance, allow high-skill immigration to support key sectors
of the economy and create a fair plan to reduce the deficit by ensuring the
rich pay "their fair share" and corporations are unable to avoid tax
responsibilities.

UKIP want to
increase the transferable tax allowance for married couples to £1500, ensure
corporations pay their fair share of tax, scrap tax on the minimum wage up to
£13,000 and abolish inheritance tax. They would reduce debt by leaving the EU,
cutting foreign aid spending and reducing Barnett Formula spending.

The Greens' focus
is to end austerity and increase public spending. The want to crack down on tax
dodgers, increase tax to 60% for those earning over £150,000 and introduce a
wealth tax on people worth £3 million or more. They want to increase the
minimum wage, create one million well-paid new public sector jobs, reduce
national insurance contributions and ensure the highest wage in any business is
no more than ten times the lowest wage.